Much like life, the only true constant in business is change. From navigating through unexpected shifts in the market to the new operational constraints brought in by COVID, professionals across all industries find themselves having to deal with massive changes–most of which were made easy by digital technology.
Accounting is no exception here. The profession has evolved beyond mere payroll and bookkeeping, to become a strategic role for businesses looking to scale. While there is a common misconception that the role of accounting in a digital world would diminish, cloud technologies like process automation, data management and advanced analytics actually have elevated accountants in unimaginable ways.
How digital technology is changing accounting firms
At the heart of this change is cloud technology. By relying on the cloud to run operations, an accounting firm can:
- Streamline repetitive processes and automate workflows
- Have a central hub for all data
- Reduce time wasted, lower costs and scale operations
- Improve transparency and accountability with clients
- Ensure that even with high volumes of data, relevant insights are produced
Digital technology eliminates the need for laborious, time-consuming tasks. By taking over the repetitive parts of the process, it frees up time for accountants, who can now focus on strategic tasks that require their experience and creativity.
For example, accountants can make use of the insights derived from cash flow analysis to better financial planning for the upcoming months. They also can work closely with other business functions through the cloud tool to leverage financial information and create cost-effective, scalable, and efficient plans.
Key benefits of digital technology for accounting firms
- A central repository for documents with access control and seamless collaboration.
- Reduced data entry time. Data can be entered in one document and is automatically updated in all connected places.
- Work is saved automatically to the cloud in real-time. This means documents can be recovered easily even if work is disrupted.
- AI can enable accountants to spot patterns and trends in financial data to enable more informed decision-making.
- By taking over all the manual work, technology ensures that even with limited staff, a firm does not feel overwhelmed with work.
What digital transformation means to today’s accounting firms
- Intelligent and adaptable accounting software that can integrate with other tools, which makes financial management, data analysis and predictions easier.
- Efficient and flexible systems enable accounting firms to deal with more clients.
- A shift of focus for accountants from doing repetitive tasks to advanced cash forecasting and strategic planning.
- More security, better backup and easy retrieval of financial information.
If you think about it, technology is really just enabling accountants to achieve what they’ve always wanted to: scale the growth of their firm, streamline processes and workflows and reduce time-consuming manual work.
So the answer to the age-old question, will automated accounting tools replace accountants?
No, they will not. Think of them like Iron Man’s suit. Just like the suit is designed to boost the wearer’s capabilities, automation tools exist to enable accountants to do their jobs effectively.
How do the technologies of today help accounting firms?
Cloud Computing
Reduces the IT burden on firms
- Accountants and their clients have 24/7 access to shared information
- Staff and clients can collaborate anytime, depending on convenience
- Labor-intensive tasks are automated, enabling accountants to focus on strategy
- Enhanced safety and security for critical financial information
Big Data
- Better decision-making for clients
- Financial data analysis can ensure a business’s performance is tracked in real-time
- Identify potential risks and eliminate or reduce them before they happen
- Effectively automate the audit process through visualizations thanks to audit analytics
- Visualizations of large sets of raw data through charts and patterns make it easy for decision-makers to identify new opportunities
Automation Technology
- Reduces errors by eliminating human intervention
- Easier to review client’s financial data
- Secure storage of critical information
- Saves time by automatically entering information and checking calculations
- Better cash flow management
- Enables clients to make better decisions about tax planning, expense management, billing and invoicing
What would having a specialized accounting tool mean for your firm?
All the benefits of an accounting software can be summarised in one word: automation. An accounting software enables:
- Efficient and reliable data entry
- Better data consolidation for more comprehensive and detailed financial reports
- Improves efficiency by removing manual tasks
In the long run, improving efficiency can save your accounting firm time and also enable your accountants to have better relationships with their clients by helping them with core business issues.
A checklist to accelerate your digital transformation
- List out your firm’s critical tasks
- Identify and prioritize the tasks that have a high business impact
- Build workflow diagrams around these tasks to visualize the internal process and spot inefficiencies
- Invest in cloud accounting tools to automate these processes
- Optimize the client onboarding process so it's easy for them to adapt to your services
- Include extensive training to ensure your team understands what is expected of them post cloud adoption
- Have a feedback-driven model to constantly improve your processes
A look down the road
The skills and job descriptions for the accounting of tomorrow are going to be more expansive than they are today. Backed by technology and evolving to more collaborative spaces, accounting teams are going to consist of a mix of accounting professionals and other subject experts who work in other areas of business.
As we saw in the beginning, change is really the only constant throughout life. While it can, at times, be stressful, that doesn’t mean it can’t be managed. By leveraging the opportunities posed for them through digital technology, accountants can soon bring their own expertise into other business functionalities by providing their critical financial perspective, refining budgets or even ensuring compliance.
It will be interesting to see how far accountants will play a more creative role in their companies. This will ensure businesses have more efficient financial processes and help them stay resilient and competitive through testing times.
Rahul Radhakrishnan works as a Content Marketer at Fyle, an expense management software. He believes everyone has a story to tell. If he isn’t writing one, he’s hearing one from someone.
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